In the Matter of Disciplinary Proceedings AgainstMichael F. Hupy, Attorney at Law:

Office of Lawyer Regulation,

Complainant-Respondent,

v.

Michael F. Hupy,

Respondent-Appellant.

DISCIPLINARY
PROCEEDINGS AGAINST HUPY

Opinion Filed:

May 27, 2011

Submitted on Briefs:

Oral Argument:

January 6, 2010

Source of Appeal:

Court:

County:

Judge:

Justices:

Concurred:

Dissented:

ROGGENSACK and ZIEGLER, JJ. dissent (Opinion filed).

Not Participating:

GABLEMAN, J. did not participate.

Attorneys:

For
the respondent-appellant there were briefs by Jeremy P. Levinson, Joseph M. Peltz and Friebert, Finerty & St. John, S.C., Milwaukee and oral argument
by Jeremy P. Levinson.

For
the complainant-respondent there was a brief and oral argument by Julie M. Scott, n/k/a Spoke, Office of
Lawyer Regulation, Madison.

2011 WI 38

notice

This opinion is subject to
further editing and modification.The
final version will appear in the bound volume of the official reports.

No. 2007AP1281-D

STATE OF WISCONSIN:

IN SUPREME COURT

In the Matter of Disciplinary Proceedings Against
Michael F. Hupy, Attorney at Law:

Office of Lawyer Regulation,

Complainant-Respondent,

v.

Michael F. Hupy,

Respondent-Appellant.

FILED

MAY 27, 2011

A. John Voelker

Acting Clerk of Supreme Court

ATTORNEY disciplinary proceeding.Attorney
publicly reprimanded.

¶1PER CURIAM. Attorney Michael F. Hupy appeals from
the report and recommendation of the referee, Attorney James J. Winiarski, that
he be publicly reprimanded for his professional misconduct and that he be
required to pay the full costs of this disciplinary proceeding. In particular, Attorney Hupy challenges the
referee's conclusions that he committed three violations of the Rules of
Professional Conduct for Attorneys.

¶2After thoroughly reviewing the matter, the court is evenly split
as to whether there is a violation of SCR 20:8.4(c) as alleged in Count 1 of
the complaint filed by the Office of Lawyer Regulation (OLR).Chief Justice Abrahamson, Justice Bradley,
and Justice Crooks conclude that Attorney Hupy engaged in conduct involving
dishonesty, fraud, deceit or misrepresentation, in violation of SCR 20:8.4(c),[1]
by sending out a mass-mailing postcard at issue in Count 1.Justice Prosser, Justice Roggensack, and
Justice Ziegler conclude that the postcard does not constitute an ethical
violation.With respect to Count 2,
Chief Justice Abrahamson, Justice Bradley, Justice Crooks, and Justice Prosser
conclude that Attorney Hupy violated SCR 20:8.4(c) by sending out a
mass-mailing brochure to potential clients in 2006 that contained a false
statement.[2]Finally, the court determines that the OLR
failed to prove a violation on Count 3, which alleged that Attorney Hupy had
violated former SCRs 20:7.1(a)[3]
and 20:7.5(a)[4]
by affixing a sticker to his correspondence in 2004 that announced the "35th
Anniversary" of his law firm, known at the time as Michael F. Hupy and Associates,
S.C.[5]

¶3We determine that a public reprimand is appropriate discipline for
Attorney Hupy's professional misconduct in conducting mass mailings of a false
advertising brochure.We emphasize that
attorneys must be careful to ensure that the advertising materials they send to
members of the public are truthful about themselves and about other attorneys.

¶4There are not four justices who would reach the same result
regarding the amount of costs to be imposed on Attorney Hupy.Chief Justice Abrahamson, Justice Bradley,
and Justice Crooks would impose all costs, with the exception of OLR's
pre-appeal attorney fees that it attempted to add in response to this court's
questions at oral argument.Justice
Prosser would impose a total of $35,000 in costs against Attorney Hupy.Justice Roggensack and Justice Ziegler would not
impose any costs because they have concluded that the OLR failed to prove any
violations against Attorney Hupy.Thus,
because three justices would impose more than $35,000 in costs and Justice
Prosser would impose $35,000 in costs, the decision of the majority of the
participating justices is to impose $35,000 in costs on Attorney Hupy.

¶5Attorney Hupy was admitted to the practice of law in Wisconsin in 1972.He has never before been the subject of
professional discipline.

¶6The first two counts of the OLR's complaint relate to advertising
pieces issued by the Hupy law firm to potential clients, in which Attorney Hupy
criticized Attorney Charles Hausmann.According to the referee's findings of fact, Attorney Hupy worked for
Attorney Hausmann's law firm, then known as Hausmann-McNallyS.C.,[6]
from 1976 to 1989.In 1989 there was a
falling out between Attorney Hausmann and Attorney Hupy, and Attorney Hupy left
the Hausmann-McNally firm to join the law firm of Jacobson, O'Dess, and KringsS.C.At the time that Attorney Hupy left, there
was considerable animosity between Attorney Hupy and Attorney Hausmann, and
that animosity has continued to the present day.Both Attorney Hupy and Attorney Hausmann
practice in the area of plaintiffs' personal injury law.They and their respective law firms have
competed for personal injury clients since 1989.

¶7In June 2002 Attorney Hausmann pled guilty to a federal charge of
interstate mail and wire fraud by depriving his clients of the right to his
honest services in connection with a kickback scheme with a chiropractor to
whom Attorney Hausmann referred clients.The federal district court sentenced Attorney Hausmann to two months
imprisonment and 16 months of supervised release.It also required Attorney Hausmann to
complete 40 hours of community service and to pay $77,000 in restitution to his
clients.Attorney Hausmann began serving
his federal prison sentence in November 2003.

¶8The OLR filed a disciplinary complaint against Attorney Hausmann
in connection with his federal conviction in January 2004.That disciplinary case ended in July 2005
with this court suspending Attorney Hausmann's license for a period of one
year, effective as of August 30, 2005.The referee in the present case specifically found that Attorney
Hausmann had ceased practicing law prior to the effective date of his 2005
suspension.Attorney Hausmann's license
was reinstated by this court in a decision dated May 17, 2007.

¶9Shortly after Attorney Hausmann was sentenced, Attorney Hupy and
his law firm began to include language in their advertisements to potential
clients that publicized Attorney Hausmann's conviction and criticized the
Hausmann-McNally firm.It has been the
practice of Attorney Hupy and the firm in which he has practiced to send out
every month direct mailings to a large number of individuals who have recently
been involved in automobile accidents.

¶10Count 1 of the OLR's complaint relates to a postcard that Attorney
Hupy began to include in those direct mail packages beginning in December
2003.The postcard was entitled
"Beware:You will Probably Get a
Letter from a Law Firm Whose Senior Partner Went to Prison on November 28,
2003."After a greeting line of
"Dear Friend," the postcard contained the following text:

Listen to one example of what lawyer advertising has
come to:Hausmann McNally law firm
Senior Partner, Charles J. Hausmann, went to prison for defrauding
approximately 200 of his firm's personal injury clients.He and his firm still send direct mail
advertising to accident victims telling them to hire a lawyer they can really
trust.Lawyers can mail letters and
advertise on television without ever having tried a personal injury case.

By separate mailing we have sent you a letter
containing an article entitled How to Find a Good Personal Injury Lawyer
and information about our firm.Please
take the time to read this article and ask questions before you hire a lawyer.

¶11The referee found that the primary purposes of the postcard (and
the other direct mail pieces sent out by Attorney Hupy and his firm) were to
solicit the legal business of individuals involved in automobile accidents and
to discourage those individuals from hiring Attorney Hausmann and his
firm.Thus, the referee concluded that
the content of the postcard was commercial speech.

¶12The referee also found that by placing the statement "Lawyers
can mail letters and advertise on television without ever having tried a
personal injury case" in the same paragraph as statements about Attorney
Hausmann's conviction and the Hausmann-McNally firm, Attorney Hupy "gave
recipients of the postcard the false impression that Hausmann and the lawyers
at the Hausmann-McNally firm had never tried a personal injury case."[7]The referee further found that the placement
of the last sentence in the first paragraph of the postcard next to statements
about Attorney Hausmann and the Hausmann-McNally law firm had been done
"deliberately, knowingly, and in reckless disregard of the truth."

¶13On the basis of these findings, the referee concluded that the
statement about not having tried a personal injury case was "dishonest,
deceitful, and misleading," and constituted a violation of SCR 20:8.4(c).

¶14The referee rejected Attorney Hupy's argument that the OLR was
estopped from prosecuting Count 1 because it had previously reviewed the
postcard and had raised no objection.In
particular, Attorney Hupy pointed to the fact that in December 2003 he had submitted
the postcard to the OLR as an advertisement pursuant to SCR 20:7.3(c)[8]
and the OLR had not objected to the postcard at that time as being false or
misleading.[9]In addition, when a grievance was
subsequently filed regarding the postcard, an OLR investigator left a
voice-mail message for an attorney at the Hupy law firm stating that the
investigator had not found anything wrong with the advertisement and had sent
the matter to the OLR's deputy director "for closure."

¶15The referee concluded that the initial review of the postcard and
the voice-mail message by the OLR investigator did not estop the OLR from
subsequently pursuing a claim of professional misconduct.As the voice-mail message made clear, an
initial review of an advertisement does not preclude the OLR from a subsequent
review if the OLR receives a grievance or determines that the advertisement is
potentially in violation of the ethical rules.With respect to the investigator's statement that he had sent the
subsequent grievance for closure, the referee noted that the grievance was not,
in fact, closed by the deputy director, who makes the final decision, subject
to review by the director, whether to close a grievance or proceed with an
investigation.

¶16Count 2 of the OLR's complaint related to another direct mail item
that was critical of Attorney Hausmann and the Hausmann-McNally firm.This writing was in the form of an article in
a direct mail brochure rather than a postcard.

¶17The article, entitled "Read Mail from Lawyers
Cautiously," began with the following paragraph:

A lawyer with an office at 633 West Wisconsin Avenue
in Milwaukee,
who pleaded guilty to a felony after defrauding 200 personal injury clients and
was sentenced to Federal prison is still practicing law pending his
appeal.His law firm is still sending
letters soliciting personal injury cases to people who have been involved in
motor vehicle accidents.The lawyer's
partner sends a 28 page brochure telling injury victims they should "Find
a lawyer and law firm they can really trust."What the brochure does not tell you is that
the senior partner was convicted of conduct that betrayed the trust and
confidence placed in him by his clients.

¶18The referee found that the lawyer referenced in this paragraph was
Attorney Hausmann and the law firm was Hausmann-McNally.Attorney Hupy's appellate brief acknowledges
that while the article does not mention Attorney Hausmann or his law firm by
name, a reader would likely have made that connection.

¶19The brochure containing this article was initially mailed to
prospective clients in November 2003.The Hupy law firm sent this brochure and article to approximately 4,000
potential clients each month for several months.The OLR did not allege and the referee did
not find that the article was false or misleading when it was mailed out during
this initial time period.At that time
Attorney Hausmann's appeal of his criminal case was indeed pending.In addition, although Attorney Hausmann began
serving his prison sentence in November 2003, his license to practice law in Wisconsin was not
suspended until August 2005, when the disciplinary proceeding against him was
completed.Thus, in late 2003 and early
2004 it was not false to say that Attorney Hausmann could have been practicing
law pending the outcome of his federal criminal appeal while the disciplinary
investigation and proceeding were in progress.

¶20The referee found, however, that Attorney Hupy and his firm once
again included the article in direct mailings in the period of March to
November 2006.No changes were made to
the article.It continued to state that
Attorney Hausmann was "still practicing law pending his appeal."The referee, therefore, found that the article
as reprinted in 2006 was false in two respects.First, by March 1, 2006, Attorney Hausmann's criminal appeal had been
long concluded and he had even been out of prison for more than two years.Second, Attorney Hausmann's license to
practice law in Wisconsin
had been suspended as of August 2005, and he remained under suspension during
the 2006 time period when the article was distributed a second time.Although Attorney Hupy attempted to argue to
the contrary, the referee explicitly found that Attorney Hausmann was not
engaged in the practice of law during the suspension of his law license.

¶21Thus, the referee found that the article's statement in 2006 that
Attorney Hausmann "is still practicing law pending his appeal" was
dishonest, deceitful, and misleading, and constituted a material
misrepresentation, in violation of SCR 20:8.4(c).The referee further found that Attorney
Hupy's use of that statement from March to November 2006 was done
"deliberately, knowingly, and in reckless disregard of the truth."

¶22The referee rejected Attorney Hupy's argument that the failure to
correct any factual inaccuracies when the article was used for a second time in
2006 was merely an oversight.The
referee pointed to the fact that neither Attorney Hupy nor his partner could
provide evidence of periodic reviews of advertising material to ensure its
factual accuracy.The referee expressly
found that Attorney Hupy had intentionally turned a blind eye to the inaccurate
statement:

It is unconscionable that the
respondent would draft such time sensitive advertising and then essentially
"forget" about the advertising and continue its use long after it had
become factually inaccurate.I do not
find that the respondent simply "forgot" about the offending
language, or that he never reviewed the content of the brochure, which had by
then been used tens of thousands of times.Respondent chose to ignore the problem language for an extended period
of time for financial gain, and for purposes of deliberately harming his major
competitor.

¶23The referee also rejected Attorney Hupy's contention that the
statement was factually accurate in 2006 because Attorney Hausmann was indeed
practicing law at that time.Although
Attorney Hupy claimed that Attorney Hausmann was practicing law because his
name remained on some Internet website in connection with the law firm's name
and on an annual report for the Hausmann-McNally law firm service corporation,
the referee found that Attorney Hausmann had not, in fact, engaged in the
practice of law during his suspension.The referee made the following specific finding:"There is no evidence that [Attorney
Hausmann] performed legal work on any client file or was present on the premises
of the law firm when any legal business was conducted during his period of suspension."

¶24Attorney Hupy made a number of other arguments against a conclusion
of professional misconduct on Counts 1 and 2 relating to the postcard and
brochure article.He asserted that the
postcard and article were protected speech under the First Amendment because
they were part of Attorney Hupy's purported campaign to educate the public
about the dangers of lawyer advertising.The referee concluded, however, that both the postcard and brochure
article constituted commercial speech.He noted that both Attorney Hupy and his partner acknowledged at the
disciplinary hearing that the Hupy law firm had a profit motive in sending out
the direct mail advertising at issue in Counts 1 and 2.Indeed, the postcard and the brochure were
mailed with other documents that clearly solicited the legal business of the
recipients.Having determined that the
communications at issue were commercial speech, the referee concluded that
neither communication was protected by the First Amendment because they
contained false and misleading statements.Zauderer v. Office of Disciplinary Counsel of the Supreme Court of
Ohio, 471 U.S.
626, 638 (1985) ("The States and the Federal Government are free to
prevent the dissemination of commercial speech that is false, deceptive, or
misleading,....").

¶25Attorney Hupy also argued that he could not be found in violation
of SCR 20:8.4(c) on Counts 1 and 2 because the OLR was obligated under that
rule to prove that he had actual knowledge or "substantial doubt" as
to the falsity of the statements.The
referee responded that SCR 20:1.0(h) defines "misrepresentation" as
the "communication of an untruth, either knowingly or with reckless
disregard."In addition, the rule
states that a person's knowledge may be inferred from the circumstances of the
communication.The referee found that
Attorney Hupy had knowingly made false statements in the two direct mail
pieces.First, he found that Attorney
Hupy knew that at the time the postcard was distributed Attorney Hausmann and
the lawyers at Hausmann-McNally had tried personal injury cases.Second, he found that Attorney Hupy knew in
2006 that the statement that Attorney Hausmann was still practicing law pending
his appeal was false.Attorney
Hausmann's appeal had ended well before that time and his license to practice
law had also been suspended.Attorney
Hupy did not show that at the time of the second use of the brochure article in
2006 he had knowledge of any facts to support the statement that Attorney
Hausmann was still practicing law pending his criminal appeal.

¶26The referee rejected Attorney Hupy's claim that Counts 1 and 2
violated due process because SCR 20:8.4(c) did not give him sufficient notice
of what communications are prohibited.The referee concluded that the prohibition against engaging in
"conduct involving dishonesty, fraud, deceit or misrepresentation"
provided sufficient notice such that a reasonable attorney, with knowledge of
the Wisconsin Supreme Court rules, would know that he or she could not make
false advertising claims like the ones made by Attorney Hupy in the postcard
and brochure article.

¶27The referee also rejected Attorney Hupy's contention that Counts 1
and 2 should have been charged under SCR 20:7.1, which prohibits false or
misleading communications about a lawyer or the lawyer's services, rather than
SCR 20:8.4(c).The referee stated that
it was within the OLR's discretion as to what charges to pursue. In addition, the referee noted that the
factual findings he had made would also have supported finding violations of
SCR 20:7.1.

¶28Count 3 of the OLR's complaint involved Attorney Hupy's use of a
sticker on his firm's letterhead in 2004 that indicated that Michael F. Hupy
and Associates, S.C., as the firm was then known, was celebrating its 35th
anniversary.The OLR alleged that this
sticker constituted a material misrepresentation about Attorney Hupy and his
law firm, in violation of SCR 20:7.1(a) and SCR 20:7.5(a), because Attorney
Hupy's "purchase" of a service corporation in 1997 did not allow him
to trace the lineage of his then-current law firm all the way back to 1969, as
the sticker indicated.

¶29Attorney Hupy has not been associated with the same firm throughout
his legal career.After graduating from
law school in 1972, he worked as an associate attorney for a firm by the name
of Eisenberg, Kletchke, and Eisenberg.As noted above, from 1976 to 1989 Attorney Hupy was an associate
attorney, a partner, and then a shareholder with the Hausmann-McNally law firm.

¶30In 1989 Attorney Hupy left Hausmann-McNally to become an associate
attorney with the law firm then known as Jacobson, O'Dess, and Krings, S.C.The first attorney listed in that firm name
was Attorney Thomas Jacobson.

¶31Attorney Hupy became a shareholder in Jacobson, O'Dess, and Krings, S.C.,
either later in 1989 or in 1990.At some
time thereafter the name of that law firm was changed to Jacobson and HupyS.C.At that point Attorney Jacobson and Attorney
Hupy were the only two shareholders in the service corporation.

¶32In late 1996 Attorney Hupy and Attorney Jacobson decided to part
ways.They ultimately entered into a
Stock Redemption and Compensation Agreement (the Redemption Agreement), which
took effect as of January 1, 1997.Pursuant to the Redemption Agreement, the service corporation purchased
all of Attorney Jacobson's shares, leaving Attorney Hupy as the sole
shareholder in the corporation.Attorney
Jacobson then left the firm to start up a new law firm.Attorney Hupy subsequently changed the name
of the service corporation to Michael F. Hupy and Associates, S.C.

¶33In paragraph 19 of the Redemption Agreement, Attorney Jacobson and
Attorney Hupy agreed that after Attorney Jacobson left the firm each of them
would "have the sole and exclusive right to the use of their respective
names and such names may not be used (in a firm name or otherwise) by the other
for purposes of engaging in the practice of law...."

¶34The OLR essentially alleged in Count 3 that because Attorney Hupy
had not been associated with the Jacobson and Hupy law firm until 1989 and had
agreed in the Redemption Agreement not to use Attorney Jacobson's name after
1997, it was a misrepresentation for him to claim in 2004 that his law firm was
celebrating its 35th anniversary.

¶35Attorney Hupy argued that the 35th anniversary sticker
used in 2004 was not a misrepresentation because the history of the firm he
owned as of 2004 could be traced back to at least 1969.This led the referee to make findings
regarding Attorney Jacobson's legal career and the firm(s) he owned and
ultimately transferred to Attorney Hupy's control.

¶36From 1962 to 1967 Attorney Jacobson practiced in a law firm by the
name of "Barbee & Jacobson." In 1967 Attorney Jacobson and
Attorney Barbee each took the legal files on which they were working and went
their separate ways.Attorney Jacobson
then began to practice law as a sole proprietor under the name "Law
Offices of Thomas Jacobson."In
1969 Attorney David Melnick began working for Attorney Jacobson.According to Attorney Melnick, he soon became
a partner with Attorney Jacobson, but he could not state whether that occurred
in 1969 or 1970.Once the partnership
was formed, the law firm went by the name of "Jacobson and Melnick."

¶37In 1972 Attorneys Jacobson and Melnick "merged" with the
practice of Attorneys Boris Sodos and Sid Sodos.The firm in which the four lawyers practiced
together was known initially as "Sodos, Jacobson, Sodos, and
Melnick."Attorney Melnick
described the arrangement between the four attorneys as a partnership, but
testified that it was not "formalized."For example, when Attorney Boris Sodos left
the arrangement shortly after it came into existence, "all he did was take
his practice with him."No money
exchanged hands when Attorney Sodos allegedly gave up his partnership
interest.The name of the law firm
simply changed to "Jacobson, Sodos, and Melnick."

¶38The referee found that the witnesses at the disciplinary hearing
were unaware of any written partnership agreements.The referee further found that if there had
been an oral partnership agreement, there was little evidence presented as to
what the terms of the agreement had been.Indeed, there was no evidence as to the terms and conditions by which
each partner had joined or left the firm between 1970 and 1974.The referee commented that the testimony
suggested more of an office-sharing arrangement than a true law firm
partnership, although there was evidence of the splitting of some fees between
the partners.The referee ultimately
concluded that the evidence supported a series of separate partnerships with
different partners rather than one continuing partnership with additional
partners joining and exiting.As support
for this conclusion, the referee pointed to the fact that the name of the firm
changed each time a new partner was added or an existing partner left.

¶39In 1974 the remaining partners incorporated their practice as a
service corporation.The referee found,
however, that the shareholders of the service corporation continued to operate
with much of the same informality that marked the period from 1970 to 1974.

¶40From 1974 to 1989 shareholders joined and left the service
corporation, and the law firm changed names at least three times.As noted, Attorney Hupy joined the firm in
1989 and soon thereafter became a shareholder.The name of the law firm/service corporation then became "Jacobson
& Hupy."

¶41The referee concluded that it was misleading for Attorney Hupy to
claim the lineage of the firm or firms that Attorney Jacobson had owned prior
to 1997.First, the referee pointed to
paragraph 19 of the Redemption Agreement, which the referee interpreted to mean
that, after January 1, 1997, Attorney Hupy could not use any of the pre-1997
history of the firm that had been associated with Attorney Jacobson.Even if Attorney Hupy was allowed under the
Redemption Agreement to use Attorney Jacobson's "history," the
referee concluded that at most Attorney Hupy could trace the history of the law
firm known in 2004 as Michael F. Hupy and Associates, S.C. only back to
Attorney Jacobson's incorporation of the service corporation in 1974.The referee believed that any history that
existed prior to that incorporation date belonged only to Attorney Jacobson,
not Attorney Hupy, because Attorney Hupy was not part of any pre-1974
arrangements.Moreover, the referee
concluded that the pre-1974 arrangements were a series of separate partnerships
rather than a single, ongoing partnership that changed into a corporate form in
1974.

¶42Because the referee determined that Attorney Hupy could not validly
trace the lineage of his firm back to 1969, he concluded that the use of the 35th
anniversary sticker in 2004 without any additional explanation was a
misrepresentation about Attorney Hupy and his firm's name and letterhead, in
violation of SCRs 20:7.1(a) and 20:7.5(a).The referee further stated that a discrepancy of even five years
regarding the founding date of the firm was a material misstatement because it
was made by Attorney Hupy in an attempt to influence the choice of a law firm
by potential clients.

¶43Having found that Attorney Hupy had committed professional
misconduct on all three of the counts set forth in the OLR's complaint, the
referee turned to the issue of the proper level of discipline.

¶44The referee properly stated the primary factors this court
considers when assessing the appropriate level of discipline:(1) the seriousness, nature, and extent of
the professional misconduct, (2) the level of discipline needed to protect the
public, the courts, and the legal system from repetition of the attorney's
misconduct, (3) the need to impress upon the attorney the seriousness of the
misconduct, and (4) the need to deter other attorneys from engaging in similar
misconduct.SeeIn re
Disciplinary Proceedings Against Arthur, 2005 WI 40, ¶78, 279 Wis. 2d 583, 694 N.W.2d 910.The referee determined that the misconduct he
had found on Counts 1 and 2 was serious because it had been intentionally
deceptive and misleading in an attempt to gain a competitive advantage over
another lawyer.The referee also
concluded that a public form of discipline was needed to impress upon Attorney
Hupy and other attorneys the seriousness of engaging in such improper
advertising, especially since Attorney Hupy had attempted to portray the
inaccurate statements in the postcard and brochure as minor and insignificant.

¶45The referee noted a number of aggravating and mitigating
factors.On the aggravating side, the
referee stated that Attorney Hupy's misconduct had stemmed from a dishonest and
selfish motive and that he had demonstrated a pattern of improper advertising
that had resulted in multiple counts of misconduct.Further, the referee concluded that Attorney
Hupy's misconduct had caused harm both to the public and to another law
firm.Finally, the referee emphasized
that Attorney Hupy had demonstrated little appreciation for the seriousness of
his misconduct, and indeed, had refused to acknowledge the wrongful nature of
his actions.The referee stated that
Attorney Hupy's claim that he had disseminated the false advertisements for an
"educational" purpose was both inaccurate and troublesome.

¶46On the mitigating side of the ledger, the referee did note that
Attorney Hupy had not previously been the subject of professional discipline
and that he had been cooperative during the OLR's investigation of his conduct.

¶47Ultimately, the referee stated that the OLR's request for a public
reprimand appeared to be lenient, but fell within the range of appropriate
discipline for the three counts of misconduct he found.The referee therefore recommended that
Attorney Hupy be publicly reprimanded.He also recommended that Attorney Hupy be required to pay the full costs
of this disciplinary proceeding.

¶48Before turning to Attorney Hupy's arguments on appeal from the
referee's report and recommendation, we discuss the standard of review that we
will apply.Generally, when reviewing a
referee's report and recommendation in attorney disciplinary proceedings, we
will affirm a referee's findings of fact unless they are found to be clearly
erroneous.SeeIn re
Disciplinary Proceedings Against Inglimo, 2007 WI 126, ¶5, 305 Wis. 2d 71,
740 N.W.2d 125.We review the
referee's conclusions of law, however, on a de novo basis.Seeid.Finally, we determine the appropriate level
of discipline given the particular facts of each case, independent of the
referee's recommendation, but benefiting from it.SeeIn re Disciplinary Proceedings
Against Widule, 2003 WI 34, ¶44, 261 Wis. 2d 45,
660 N.W.2d 686.

¶49Attorney Hupy contends, however, that we should apply a standard of
independent review because he raises First Amendment arguments.We agree to the limited extent that we are
called upon to decide First Amendment issues and to apply First Amendment law
to the facts of this case.As to those
issues, U.S. Supreme Court precedent requires us to conduct an independent
examination of the record to determine whether Attorney Hupy's conduct is
within or without the free speech protections of the First Amendment.SeeBose Corp. v. Consumers Union
of United States, Inc., 466 U.S. 485, 514 & n.31 (1984) (federal rule
of civil procedure requiring finding of fact to be clearly erroneous before
being overturned did not apply to determination of First Amendment issue of
actual malice, but clearly erroneous standard could be applied to findings of
fact not relevant to the First Amendment issue).

¶50Attorney Hupy's appeal challenges all three of the counts of
misconduct found by the referee.Some of
his arguments apply to one specific count while others apply to multiple
counts.We will address each count in
turn.

¶51On Count 1, the referee found that Attorney Hupy's mailing of the
postcard containing the sentence "Lawyers can mail letters and advertise
on television without ever having tried a personal injury case" constituted
conduct involving dishonesty, fraud, deceit, or misrepresentation, in violation
of SCR 20:8.4(c).

¶52All four of the descriptive words used in SCR 20:8.4(c)
require that there be an untruth.Attorney Hupy begins his challenge to Count 1 on the grounds that
neither the OLR's allegations nor the evidence demonstrated that the postcard
contained a "specific, concrete, and meaningfully inaccurate
representation of fact."He notes that
the OLR's complaint alleged that the challenged sentence in the postcard
created a false or misleading impression that the lawyers in the
Hausmann-McNally firm had advertised without ever having tried a personal
injury case.

¶53Attorney Hupy contends that there is no evidence in the record to
show what impression was made on any recipient of the postcard.No recipient of the postcard testified.According to Attorney Hupy, those individuals
that did testify gave differing views as to whether the challenged sentence
referred to Attorney Hausmann, all of the lawyers at the Hausmann-McNally law
firm, or lawyers generally.If the
sentence referred either to Attorney Hausmann individually or to the lawyers at
the Hausmann-McNally firm collectively, the statement would have been untrue.On the other hand, if the sentence simply
referred to lawyers generally, it is true in theory that lawyers can mail
letters and advertise on television without ever having tried a personal injury
case.In Attorney Hupy's view, since the
recipients of the postcard did not testify that they viewed the challenged
sentence as referring specifically to Attorney Hausmann or the lawyers at the
Hausmann-McNally firm, the OLR failed to prove that the sentence was untrue.

¶54Attorney Hupy further argues that the simple juxtaposition of the
challenged sentence next to other sentences that specifically referred to
Attorney Hausmann and the Hausmann-McNally firm is not enough to render the
sentence untrue and a basis for imposing sanctions.He argues that the U.S. Supreme Court's
decision in Peel v. Attorney Registration and Disciplinary Commission of
Illinois, 496 U.S. 91 (1990), rejected the notion that the juxtaposition of
true statements can create a misleading impression that can be prohibited or
penalized.He contends that without
evidence that recipients in fact were misled, the only support for a finding
that the sentence was false or misleading is an unproven hypothesis that the recipients
viewed the challenged sentence as referring to Attorney Hausmann or the lawyers
in the Hausmann-McNally law firm.

¶55Attorney Hupy also argues that the evidence does not show that he
made the statement in the postcard with the required knowledge of falsity or
reckless disregard for the truth.He
starts from the premise that the referee did not find the challenged sentence
to involve dishonesty, fraud, or deceit because those terms require
intentionality by the actor/speaker, but instead relied solely on the final term
in SCR 20:8.4(c)——misrepresentation.[10]He then points to the definition of
misrepresentation in SCR 20:1.0(h), which defines the term as
"communication of an untruth, either knowingly or with reckless disregard,
whether by statement or omission, which if accepted would lead another to
believe a condition exists that does not actually exist."

¶56Attorney Hupy asserts that the definition of "reckless
disregard" should be further developed by reference to civil defamation
law.In particular, he points to the
court of appeals' statement in Biskupic v. Cicero, 2008 WI App 117, ¶27, 313 Wis. 2d 225, 756 N.W.2d 649, that to
demonstrate reckless disregard, a complainant "must show that the
defendant in fact entertained serious doubts as to the publication's
truth."He therefore argues that
the OLR was required to show by clear and convincing evidence that he
recognized the impression of the sentence that the OLR now claims to be
misleading and in fact had serious doubts as to whether that impression was
true.

¶57Attorney Hupy contends that the OLR cannot meet this standard
because there is no evidence that he ever believed the challenged statement in
the postcard referred to the lawyers in the Hausmann-McNally law firm.He points to the fact that both he and his
law partner testified at the disciplinary hearing that they believed the
sentence referred only to lawyers generally and was meant only to be a general
criticism of lawyer advertising.He
contends that the only thing the OLR was able to present was ambiguity or
differing potential interpretations of the sentence, which are not sufficient
evidence of a false statement.

¶58The OLR responds that to establish a violation of
SCR 20:8.4(c) it is not required to plead or prove the tort of
misrepresentation or to demonstrate that an attorney engaged in an outright
fraud.It points to the language of the
rule, which prohibits attorneys from engaging in conduct involving
dishonesty, fraud, deceit, or misrepresentation.It further emphasizes that the rule does not
require it to establish specific intent; recklessness by an attorney in making
a statement is sufficient for a violation of the rule.

¶59In response to Attorney Hupy's claim that the use of the challenged
sentence in the postcard was essentially an innocent oversight, the OLR points
to the referee's finding that the placement of the challenged sentence in the
same paragraph as criticisms of Attorney Hausmann and the Hausmann-McNally law
firm was done deliberately and knowingly to give recipients the impression that
Attorney Hausmann and the lawyers in the Hausmann-McNally law firm had not
tried personal injury cases.The OLR
emphasizes that the sentence at issue was placed in an advertisement that began
with the following headline:"Beware:You Will Probably
Get A Letter From A Law Firm Whose Senior Partner Went To Prison On November
28, 2003."Thus, the OLR argues
that the postcard was clearly intended to refer to Attorney Hausmann and the
Hausmann-McNally law firm.

¶60Attorney Hupy also continues to argue that the OLR should be
estopped from proceeding with any claim related to the postcard because (1) it
approved (or at least did not object to) the postcard when Attorney Hupy
originally submitted a copy of it to the OLR pursuant to SCR 20:7.3(c), and (2)
after a grievance regarding the postcard was subsequently filed by the OLR, an
OLR investigator left a voice-mail message for Attorney Hupy's partner
indicating that he would be sending the grievance for closure.Attorney Hupy essentially asserts that because
the OLR did not object to the postcard and in his view closed the subsequent
grievance relating to the postcard, it would be impermissibly arbitrary for the
OLR to "reopen" the matter and pursue an ethical charge that is based
on the postcard.

¶61Following oral argument, this court directed the OLR to submit an
additional memorandum discussing the scope of its review of advertising
materials under SCR 20:7.3 and the nature of its procedures for communicating
with attorneys who have submitted materials pursuant to SCR 20:7.3(c).The OLR's response explains that its review
under SCR 20:7.3(c) is generally limited to determining whether the submitted
document has been properly labeled as "Advertising Material" as
required by SCR 20:7.3(c).The submitted
advertisement is not specifically reviewed for its content, unless there is
patently visible language that raises an unmistakable issue of possible
misconduct, in which case the OLR may begin an investigation.The OLR further states that it generally will
not send any communication to the submitting attorney if the advertisement has
been properly labeled.If the submitting
attorney affirmatively asks for a positive response following the OLR's
consideration, the OLR will generally advise the attorney only that the
submitted document complies with SCR 20:7.3.On the other hand, if the advertisement is not properly labeled, the OLR
will also notify the attorney of that fact.The OLR emphasizes that it does not ever communicate that a submitted
advertisement has been "approved" or "authorized for
use."Thus, the review of an
advertisement by the OLR under SCR 20:7.3(c) and the lack of any objection
by the OLR following that review should not be taken as a stamp of approval
that the advertisement complies with all ethical rules.

¶62With respect to Attorney Hupy's argument regarding the voice-mail
message left by its investigator, the OLR contends that the voice-mail message
cannot form the basis for any estoppel because, despite the investigator's
stated intention to send the grievance regarding the postcard to the OLR's
deputy director for closure, the referee expressly found that the grievance was
never, in fact, closed.Instead, the
deputy director determined that the matter should be forwarded for a formal
investigation.The OLR argues that
because it never communicated a final decision to Attorney Hupy, it cannot be
estopped from pursuing a course of action contrary to the initial course of
action suggested by the investigator.

¶63As noted above, the court is evenly split with respect to whether
the statement in the postcard constituted a violation of SCR 20:8.4(c).Chief Justice Abrahamson, Justice Bradley,
and Justice Crooks conclude the message of the postcard was that lawyers in the
Hausmann-McNally firm had advertised without having tried a personal injury
case, which constituted conduct involving dishonesty, fraud, deceit, or
misrepresentation in violation of SCR 20:8.4(c).Justice Prosser, Justice Roggensack, and
Justice Ziegler conclude that the OLR has not proven that the specific
statement at issue in the postcard was a misrepresentation.Because the court is evenly split as to
whether there was a violation on Count 1, we need not further address Attorney
Hupy's constitutional and other challenges to the application of SCR 20:8.4(c)
to the postcard.

¶64With respect to Count 2, Attorney Hupy's initial argument is that
the brochure article at issue did not contain any meaningful inaccuracy and the
referee relied on an overly literal construction of the phrase "is still
practicing law pending his appeal."He emphasizes that the challenged statement that Attorney Hausmann is
still practicing law pending his appeal was accurate when the brochure was
written and initially distributed in 2003.He contends that for a number of reasons he should not be found to have
violated SCR 20:8.4(c) because he reprinted and distributed the same
article in 2006.

¶65First, he asserts that the premise of the article was a criticism
of the lawyer regulatory system for allowing Attorney Hausmann to practice law
after he had been convicted of a felony.He therefore contends that this "message" of criticism
remained true in 2006, even if one sentence of the article had become
outdated.He argues that his opinion on
a matter of public concern should not be transformed into professional
misconduct due to a "technical debate of the verb tense of an isolated
phrase."

¶66Attorney Hupy's brief also claims that the article did not
expressly identify Attorney Hausmann, which supports his assertion that the
article had a larger focus on criticism of lawyer advertising and lawyer
regulation.

¶67Next Attorney Hupy asserts that Attorney Hausmann was, in fact,
still practicing law in 2006 when the article at issue was reprinted.He points to the fact that an annual
corporate report filed by the Hausmann-McNally firm with a state agency in
2005, which remained on file in March 2006, identified Attorney Hausmann as a
shareholder, officer, and director of the law firm.He also points to the fact that Attorney
Hausmann remained a shareholder of the service corporation and received a
certain type of compensation from the Hausmann-McNally firm during his
suspension.He asserts that, at a
minimum, there was enough evidence of Attorney Hausmann's practice of law in
2006 that the issue was debatable and that he therefore cannot be found to have
made a knowing misrepresentation.

¶68Attorney Hupy also makes a number of arguments that pertain to both
Counts 1 and 2.We did not reach these
arguments with respect to Count 1 due to the even split in the participating
members of the court.We address them
now in connection with Count 2.

¶69Attorney Hupy contends that any misstatement in the article as
reprinted in 2006 was a technical inaccuracy that cannot be the basis for
professional discipline because it does not call into question his fitness to
practice law.In other words, Attorney
Hupy asserts that SCR 20:8.4(c) must be interpreted to prohibit only
misrepresentations that reflect adversely on a lawyer's fitness to practice law
because a broader scope of the rule could significantly inhibit a lawyer's
exercise of his/her free speech rights.As support for this position, Attorney Hupy points to this court's
decision in In re Disciplinary Proceedings Against Beaver, 181 Wis.2d12, 22, 510 N.W.2d129 (1994), in which we
stated that the context of the term "offensive personality" in the
attorney's oath[11]
and its application to attorney disciplinary proceedings required that it be
limited to conduct that reflects adversely on a person's fitness as a lawyer.

¶70He also argues that he cannot be found to have violated SCR
20:8.4(c) because the OLR did not submit proof that he reprinted the article in
2006 with actual knowledge of, or reckless disregard for, the allegedly false
statement in the reprinted article.He
says that in March 2006, when the article was reprinted verbatim, he did not
perceive that the events that had occurred between 2003 and 2006 warranted a
review of the statements in the article and "was not actually aware that
the three year old article contained the specific, challenged phrase."

¶71Next Attorney Hupy asserts that applying SCR 20:8.4(c) to the
reprinted article would cause the rule to "violate principles of due
process by denying attorneys fair notice of what is prohibited."He argues that SCR 20:8.4(c) does not provide
lawyers with sufficient notice that it imposes standards for the accuracy of
advertising communications, especially since such communications are also
subject to SCRs 20:7.1 through 20:7.5.

¶72Finally, Attorney Hupy argues that SCR 20:8.4(c) must not be
interpreted to apply to the reprinted article because such an interpretation would
infringe on his free speech rights under the United States and Wisconsin
constitutions.He asserts, contrary to
the referee's conclusion, that the brochure article is not commercial speech
because it does not propose a transaction.SeeCity of Milwaukee v. Blondis, 157 Wis. 2d 730, 735, 460 N.W.2d 815 (Ct. App.
1990) ("Commercial speech is speech that proposes a commercial
transaction.").Thus, he contends
that the article deserves the fullest protection of the First Amendment because
it discusses matters of public interest.He asserts that the "inexact standards" propounded by the OLR
and the referee regarding the application of SCR 20:8.4(c) would not meet the
strict scrutiny applied to political speech because those standards do not serve
the government interests typically served by rules that discipline individuals
for engaging in fraud or misrepresentation.

¶73In addition, Attorney Hupy contends that even if the brochure
article is characterized as commercial speech, it cannot form the basis for
professional discipline because suppressing the article or disciplining
Attorney Hupy for it would serve only the private interests of Attorney
Hausmann rather than the interests of the public in deterring misleading speech
by attorneys.

¶74The OLR responds that the referee's finding of a violation is
supported by the record.It asserts that
by March 1, 2006, it was clear that Attorney Hausmann had been out of
prison for more than two years and that his criminal appeal had already been
completed for a long time, making the challenged statement undoubtedly
false.It points to the referee's
credibility determinations that Attorney Hupy did not simply forget about the statement
in the article that Attorney Hausmann was still practicing law pending his
appeal and that Attorney Hupy chose to ignore the falsity of that statement for
an extended period of time for his own financial gain and in order to harm a
competing lawyer.

¶75The OLR contends that sending out the mailing again in 2006 was not
an innocent mistake.It states that if
Attorney Hupy and his partner had reviewed all advertising communications prior
to their circulation, as Attorney Hupy's brief asserts, he would have known
that the article was no longer correct in 2006.Thus, the OLR argues that the circulation of the reprinted article was
done at least with reckless disregard.

¶76The OLR disputes that Attorney Hausmann was practicing law during
his suspension in 2006.It emphasizes
that the referee expressly found that Attorney Hausmann was not practicing law
at that time.It points to the referee's
statement that Attorney Hausmann and the Hausmann-McNally firm "went to
great lengths to comply with all parts of the suspension order," including
changing all signage, letterhead, advertising, etc., and hiring outside counsel
to advise them on complying with the order.Moreover, the OLR stresses that in 2006, when the brochure article was
used for the second time, Attorney Hupy had no knowledge of any of the actions
by Attorney Hausmann and the law firm that he now claims constituted the
practice of law by Attorney Hausmann.Attorney Hupy developed that evidence only after the fact when facing
charges in this disciplinary proceeding.

¶77With respect to Attorney Hupy's First Amendment claims, the OLR
notes that commercial speech, including attorney advertising, can be regulated
or prohibited if it is false, deceptive, or misleading.Zauderer, 471 U.S. at 637-38.The OLR contends that the referee
appropriately concluded that the brochure article was commercial speech because
the primary purpose of the article was to solicit business and to harm a major
competitor.It further asserts that the
brochure article is not entitled to First Amendment protection because the
statement about Attorney Hausmann still practicing law in 2006 was untruthful
and Attorney Hupy knew it was untruthful.

¶78Under our standard of review, we first determine that the referee's
findings of fact are not clearly erroneous.We therefore adopt those findings and use them to determine whether the
use of the brochure article in 2006 was a violation of SCR 20:8.4(c).

¶79We conclude that the facts as found by the referee show that
Attorney Hupy did violate SCR 20:8.4(c) by mailing to prospective clients in
2006 a brochure containing the statement that an attorney, who was clearly
Attorney Hausmann, "is still practicing law pending his appeal."

¶80We first address Attorney Hupy's contention that the brochure
article did not identify Attorney Hausmann by name.Although the article did not use Attorney
Hausmann's name, it clearly identified him by giving the address of the
Hausmann-McNally law firm and referring to him as the attorney who had pled
guilty to defrauding personal injury clients.Indeed, Attorney Hupy's opening brief to this court acknowledged that
the article referred to Attorney Hausmann.

¶81We also do not agree with Attorney Hupy's claim that he cannot be
disciplined for using the article in 2006 because the article contained only a
technical inaccuracy.We acknowledge
that the "still practicing" statement in the article was accurate
when it was first disseminated in 2003.Attorney Hupy acknowledges, on the other hand, that the statement was
not true when the article was reprinted verbatim in 2006 because by that time
Attorney Hausmann's criminal appeal had been completed and his license to
practice law in Wisconsin
had been suspended.The statement was
clearly a misrepresentation of fact when it was made again in 2006.That it was a repetition of a formerly true
statement does not change its nature as a false statement in 2006.

¶82We further reject Attorney Hupy's argument that the false statement
cannot be a violation of SCR 20:8.4(c) because it was not substantial enough
and did not relate to Attorney Hupy's fitness to practice law.The statement in the article made in 2006
asserted that Attorney Hausmann was still practicing law.This is not a de minimis accusation.Since Attorney Hausmann's license to practice
law in this state was suspended at that time, Attorney Hupy's statement was an
accusation that Attorney Hausmann was violating this court's suspension order,
a serious allegation of professional misconduct.

¶83Moreover, without deciding whether a misrepresentation must relate
to an attorney's fitness to practice law in order to be a violation of SCR
20:8.4(c), we conclude that Attorney Hupy's misrepresentation here does
implicate his fitness to practice law.Thus, even under the standard Attorney Hupy desires, his statement in
the brochure article violates the rule.He made a clearly false statement about one of his primary competitors
in a brochure that was part of a direct mail advertising package sent to a
targeted audience of potential clients.Making false statements about a competing lawyer in order to obtain more
clients for one's self clearly implicates one's fitness to exercise the
privilege of practicing law in this state.

¶84Indeed, that conclusion is supported by the fact that another rule
of professional conduct explicitly prohibits making false or misleading
communications about the lawyer or the lawyer's services.See SCR 20:7.1.If it is an ethical violation to make a false
or misleading statement about one's self in a communication with prospective
clients, there is no reason why it should not also be an ethical violation to
make a false statement about a competing lawyer in such a communication.Both types of statements may wrongly
influence a potential client's decision about which lawyer to retain or not
retain.

¶85We next address Attorney Hupy's contention that the statement at
issue was not a misrepresentation because Attorney Hausmann was "still
practicing law" in 2006.In order
to prevail on this argument, Attorney Hupy must demonstrate that the referee's
findings of fact were clearly erroneous.Specifically, the referee found that (1) "there is no evidence in
this case that [Attorney] Hausmann practiced law during his suspension" and
(2) "[t]here is no evidence that he performed legal work on any client
file or was present on the premises of the law firm when any legal business was
conducted during his period of suspension."

¶86It is important to recognize that the statement in the brochure
article was not meant for an audience of legal ethics professors, but for the
general public, specifically potential personal injury clients.Thus, the phrase "is still practicing
law" must be read according to its ordinary meaning of representing
clients.None of the evidence on which
Attorney Hupy relies supports a finding that Attorney Hausmann was doing
anything related to the representation of clients.Regardless of whether or not Attorney
Hausmann should have relinquished his shares in the service corporation during the
period of his suspension, an issue we need not decide in this proceeding,
merely passively owning shares in a service corporation, without more, does not
mean that Attorney Hausmann was "practicing law" as that phrase is
generally understood.Moreover, the 2005
corporate report cited by Attorney Hupy was filed before Attorney Hausmann's
suspension took effect.It does not
undercut the referee's finding that Attorney Hausmann was not practicing law in
early 2006, especially given the fact that the 2006 corporate report showed
that Attorney Hausmann was no longer president of the service corporation.

¶87In a related vein, Attorney Hupy argues that he should not be
disciplined for the article because the OLR did not prove that he was reckless
in stating that Attorney Hausmann was still practicing law in early 2006.We disagree that there is no evidence to
support a conclusion that Attorney Hupy acted recklessly.

¶88First, the referee found that Attorney Hupy was aware of the
suspension of Attorney Hausmann's license to practice law in August 2005.Indeed, Attorney Hupy had his firm's outside
legal counsel stand outside the Hausmann-McNally firm's offices on the date the
suspension took effect in 2005 to ensure that Attorney Hausmann's name had been
removed from all signage.This was not a
situation where Attorney Hupy was ignorant of what the situation was at the
time that he republished the brochure in 2006.

¶89Second, Attorney Hupy's brief in this court points to contradictory
statements that demonstrate that Attorney Hupy's second publication of the
brochure article was done either knowingly or recklessly.First, Attorney Hupy points to testimony by
himself and his partner that they reviewed all communications written for
circulation by their firm to ensure their accuracy.On the other hand, Attorney Hupy's brief
contends that he "was not actually aware that the three year old article
contained the specific, challenged phrase" or that the passage of time
warranted review of the contents of the article.Given Attorney Hupy's knowledge of the
suspension and the steps taken by Attorney Hausmann and his firm to comply with
the suspension order, if Attorney Hupy did actually review the brochure article
in early 2006, as he claims he always did, he would have noticed that the
article falsely stated that Attorney Hausmann was still practicing law pending
his criminal appeal.Thus, his continued
use of that brochure article would have been with knowledge of the article's
falsity regarding that statement.On the
other hand, if Attorney Hupy was not actually aware in early 2006 that the
article contained the allegation that Attorney Hausmann was still practicing
law, then he could not have reviewed the article prior to using it a second
time.Publishing a statement, especially
a statement that a fellow lawyer is violating a supreme court order, without
knowing the contents of the statement, is a quintessential act of recklessness.

¶90Third, it is important to note that the referee explicitly found
that Attorney Hupy looked for and created the reasons he now gives as proof of
Attorney Hausmann practicing law in early 2006 only well after the brochure had
been published again in March 2006 and even after the grievance against him in
this matter had been filed with the OLR.

¶91Attorney Hupy's claim that SCR 20:8.4(c) violates his due process
rights because it is too vague to provide an attorney with notice of what is
prohibited has previously been rejected by this court.In re Disciplinary Proceedings Against
Schalow, 131 Wis.
2d 1, 13, 388 N.W.2d 176 (1986).In that
case, Attorney Schalow alleged that the prohibition against engaging in
"conduct involving dishonesty, fraud, deceit or misrepresentation,"
located at the time in SCR 20.04(4), was overbroad and vague.After noting that there needs to be a greater
degree of flexibility with respect to vagueness in attorney disciplinary rules
than in criminal statutes, we concluded that the rule against conduct involving
dishonesty, fraud, deceit or misrepresentation provided sufficient notice of
prohibited conduct to satisfy due process:

Our rule, SCR 20.04(4), while set forth in general and,
arguably, less than definite terms, is neither so indefinite as to leave a
lawyer, at his or her peril, to guess its meaning nor so lacking in
ascertainable standards as to render it constitutionally infirm.

Id.Attorney Hupy's arguments do not convince us otherwise.At a minimum, the rule provided sufficient
notice to Attorney Hupy that attorneys licensed in this state must avoid making
false statements about other lawyers in advertising communications to potential
clients.

¶92We also reject Attorney Hupy's claim that imposing discipline on
him for republishing the statement in the brochure article in 2006 would
violate his free speech rights.First,
we conclude, as did the referee, that the brochure article constituted
commercial speech.Attorney Hupy
contends that the article was not commercial speech because it did not
expressly propose a commercial transaction.The brochure article, however, was not distributed as a stand-alone
communication.It was part of a packet
of materials that Attorney Hupy and his firm sent to potential personal injury
clients.The brochure article was
clearly meant to act together with the other materials in the packet to
convince the recipient to contact Attorney Hupy and his firm so that a client
relationship could be formed, or at least discussed.The use of the brochure in an ongoing direct
mail advertising campaign belies Attorney Hupy's claim that the brochure
article was simply intended to educate or advise the public about the dangers
of lawyer advertising.

¶93Having concluded that the brochure article was commercial speech,
we have no trouble concluding that the statement in the article was not
protected by either the First Amendment of the United States Constitution or
Article I, section 3
of the Wisconsin Constitution, even under an independent standard of
review.While commercial speech
generally merits some protection under the First Amendment, that protection does
not extend to commercial speech that is false, deceptive, or misleading.Zauderer, 471 U.S. at 638.Because the statement in the article that
Attorney Hausmann was still practicing law pending his appeal was clearly false
when it was republished in 2006, the First Amendment does not protect Attorney
Hupy from being disciplined for that ethical violation.

¶94We next turn to Count 3 of the complaint, which involved Attorney
Hupy's use of a 35th anniversary sticker on his firm's letterhead in
2004.In addition to raising many of the
same arguments he made with respect to Counts 1 and 2, Attorney Hupy contends
that the referee effectively shifted the burden of proof from the OLR to
him.Specifically, he contends that there
was a stipulation that the law firm corporation had a continuous existence back
to 1974 and that the referee's conclusion that the law firm's existence did not
extend back to 1969 was based on a finding that there was insufficient evidence
to conclude that there was one continuous partnership between 1969 and 1974
instead of a series of partnerships.He
asserts that the referee therefore required him to prove that there had been
one continuous partnership between 1969 and 1974 rather than requiring the OLR
to prove that there had been a series of separate partnerships.

¶95Attorney Hupy also contends that the referee's finding of fact that
the law firm he owned in 2004 could not trace its existence back to at least
1969 is erroneous.He asserts that the
various lawyers associated with the firm over the years all testified that the
firm never ceased to exist after 1969 and that they understood the firm's
founding date to be no later than 1969.

¶96In addition, Attorney Hupy argues that the referee erred in making
an unsubstantiated determination that a difference between a 1974 founding date
and a 1969 founding date was material.He notes that the OLR submitted no evidence regarding the materiality of
any such difference, while his expert witness opined that no reasonable
consumer would make a decision on hiring a law firm based on a difference of a
few years in its founding date.

¶97Although it acknowledges that there has never before been an attorney
disciplinary case involving the founding date of a law firm, the OLR contends
that the referee's finding of a violation here should be upheld.It urges that under Wisconsin
partnership law, the burden of proof should be on the party claiming that a
single partnership existed prior to 1974, which would be Attorney Hupy.It further asserts that Attorney Hupy did not
demonstrate that a single partnership existed prior to 1974 because there was
insufficient evidence to establish that the individuals who practiced together
prior to 1974 actually had a community of interest in the capital employed by
them, had equal voices in the management of a single entity, and shared the
profits and losses of a single organization, which are all elements necessary
to create a valid partnership under Wis. Stat. ch. 178.SeeStern v. Dep't of Revenue,
63 Wis.2d506, 509-10, 217 N.W.2d326 (1974).With respect to the question of materiality,
the OLR simply points to the referee's statement that a reasonable client would
have felt misled if he or she had later learned that the 35th
anniversary sticker had been false.

¶98We conclude that Count 3 can be resolved on the issue of
materiality.Supreme court rule 20:7.1
prohibits a lawyer from making false or misleading communications about the
lawyer or the lawyer's services.Former
SCR 20:7.1(a) explains that a communication is false or misleading if it
"contains a material misrepresentation of fact or law or omits a fact
necessary to make the statement considered as a whole not materially
misleading."It is therefore clear
that a false or misleading statement about the attorney or the attorney's
services must be material for there to be a violation of the rule.

¶99First, we address the referee's comments about the Redemption
Agreement under which Attorney Jacobson sold all of his shares back to the
service corporation, leaving Attorney Hupy as the remaining shareholder.Because the Redemption Agreement contained a
provision that each attorney would have the exclusive right to the use of their
respective names, the referee stated that Attorney Hupy had improperly made use
of Attorney Jacobson's name and history by using the date on which Attorney
Jacobson started the firm in which Attorney Hupy is now a shareholder.

¶100We disagree that the Redemption Agreement prohibited Attorney Hupy
from communicating about the date when the firm which he now partially owns was
started.Placing a 35th
anniversary sticker on the firm's letterhead did not use Attorney Jacobson's
name in violation of the contractual provision.The referee points to no contractual provision that prohibited Attorney
Hupy from speaking about the history of the legal service corporation he solely
owned following the redemption of Attorney Jacobson's shares.Thus, since there is no dispute that this
service corporation was incorporated in 1974 and has been in continuous
existence as a law firm since that time, we find no reason why Attorney Hupy
could not make statements in 2004 that the law firm of which he was then an
owner had at least a 1974 founding date.

¶101Given this background, the question of materiality becomes
clearer.The issue is not whether a
potential client or other reader of the anniversary sticker would find the
difference between a 35th anniversary sticker and no anniversary
sticker material.Attorney Hupy was
entitled at least to communicate in 2004 that the law firm he then owned was 30
years old.The true question presented
is therefore whether a potential client or other reader would have found it to be
a material difference if the sticker had read "30th
Anniversary" instead of "35th Anniversary."We agree with Attorney Hupy that no
reasonable person would be influenced by a five-year difference between a
personal injury law firm that was either 30 years old or 35 years old.In other words, we do not believe that any
reasonable person would have retained Attorney Hupy's law firm on the belief
that it was 35 years old but would not have retained the firm if he/she knew
that it was really only 30 years old.Consequently, because we determine that the anniversary sticker, even if
false or misleading, was not material, we conclude that Attorney Hupy's use of
the sticker was not a violation of former SCRs 20:7.1(a) or 20:7.5(a).

¶102With a majority of the court having concluded that Attorney Hupy
violated SCR 20:8.4(c) by recirculating a brochure article in early 2006, as
alleged in Count 2 of the OLR's complaint, we address the proper level of
discipline.We conclude that a public
reprimand is appropriate in this situation.

¶103We acknowledge that Attorney Hupy has not previously been the
subject of professional discipline and that he cooperated with the OLR's
investigation.We agree with the
referee, however, that the use of the brochure article with the false statement
in early 2006 was a serious violation that requires a public reprimand.As the referee found, Attorney Hupy sent out
a false statement essentially alleging that one of his primary lawyer competitors
was violating this court's suspension order and engaging in unethical conduct
in order for Attorney Hupy to gain a competitive advantage over the other
lawyer.This not only harmed the other
lawyer, but more importantly harmed the public.Indeed, it harmed a portion of the public that may very well have been
looking for legal representation at the time it received the brochure
article.Moreover, this was not a false
statement made to a limited number of potential clients.It is clear that Attorney Hupy and his firm
included this false statement in mailings that were sent to thousands of
individuals who had recently been involved in a vehicle collision and therefore
may have been potential clients.

¶104Moreover, the referee found that Attorney Hupy has little
appreciation for the seriousness of his misconduct.The referee found troublesome Attorney Hupy's
attempt to justify his false statement about Attorney Hausmann as being part of
an "educational" plan rather than acknowledging that he should not
have mailed out the same brochure in 2006 when it now contained a false
statement about a competing lawyer.Although a lawyer accused of misconduct may certainly litigate the
matter, we agree with the referee's finding that it strains credulity too far
to claim that a brochure that Attorney Hupy labeled as "advertising"
and directed to individuals who were likely to be considering hiring a lawyer
was merely "educational."Attorney Hupy's failure to acknowledge the true nature of the brochure
article and the seriousness of the false statement within it counsels in favor
of public discipline in this case.

¶105In addition, although every disciplinary case is unique, there are
precedents that support the imposition of a public reprimand for a violation
like the one committed by Attorney Hupy.See, e.g., In re Disciplinary Proceedings Against Campbell,
113 Wis.2d715, 335 N.W.2d881 (1983) (accepting
stipulation and imposing public reprimand on attorney who falsely advertised
that he was a partner in a law firm rather than an employee); Public Reprimand
of James S. Lindgren, 2010-8 (consensual public reprimand imposed on attorney
who used law firm letterhead indicating he had continuing and full affiliation
with law firm when he had either no status or of counsel status for a limited
purpose); Public Reprimand of Nancy L. Bergstrom, 2009-4 (consensual
public reprimand imposed on attorney with no prior discipline who issued press
release containing false statement).

¶106Finally, we address the issue of the costs of this proceeding.Prior to the appeal in this matter, the OLR
submitted a statement of costs that requested a pre-appeal cost assessment of
$45,916.88 against Attorney Hupy.Of
that amount, $29,356.42 was for the referee's fees and expenses.The OLR requested $6,174.00 in attorney fees
for 88.2 hours of work and $630.86 in disbursements.

¶107Attorney Hupy made a number of objections to this requested amount
and asked that the costs be reduced.Specifically, he contended that the majority of the OLR's allegations
against him had been shown to be baseless.He further argued that the misconduct found by the referee was subject
to dispute and that he should not be required to pay such high costs when he
was acting in the public interest by educating the public about lawyer
advertising.Attorney Hupy also
specifically objected to the amount of the referee's fees.He asserted that the number of hours the
referee had spent on this case (481.6 hours) was excessive because it was
nearly five times greater than the 88.2 hours identified by the OLR.He requested that the referee's fees be
reduced so that they correlated with the number of hours requested by the OLR.

¶108At oral argument, this court questioned OLR's counsel about its fee
records.Specifically, we noted that it
appeared that the OLR's billing itemization did not contain entries for at
least some dates on which the disciplinary hearing had been held.OLR's counsel responded that she would review
the billing records.

¶109Following oral argument, the OLR submitted a "supplemental and
amended" statement of costs.Most
of the costs were the same as in the original statement, including the fees
requested for the referee.However, in
addition to adding a request for the fees it incurred during this appeal (35
hours and $2,450), the OLR also stated that after reviewing its time records,
its counsel had discovered an additional 58.53 hours of pre-appellate work,
which increased its pre-appellate fees from $6,174 to $10,271.11, a difference
of $4,097.11.The total amount requested
by the OLR in its "supplemental and amended" statement of costs was
$52,463.99.

¶110Attorney Hupy did not object to the fees incurred by the OLR on
appeal, but he did restate his earlier objections and did specifically raise a
new objection to the OLR's increased request for pre-appellate fees.He noted that the OLR had offered no
explanation for how or why the increased pre-appellate fees had been omitted
from the OLR's initial statement of costs, which he claimed deprived him of an
opportunity to evaluate them.In
addition, he contended that the submission of those additional pre-appellate
fees came months after the deadline for such fee requests, which was 20 days
after the filing of the referee's report.See SCR 22.24(2).

¶111In response, the OLR acknowledged that its counsel had made mistakes
in listing her pre-appellate hours in its original statement of costs.It asserted, however, that it should be
allowed to correct its mistake.It
claimed that its supplemental statement was timely because the rules allow the
OLR to file a supplemental statement when an appeal is filed.See SCR 22.24(2) (supplemental
statement of costs may be filed within 14 days after an appeal is assigned for
submission to the court or briefs ordered by the court are filed).To the extent that the pre-appellate fee request
was increased after the filing of the appeal, the OLR simply contended that the
time limit for initial cost statements is not jurisdictional and should be
extended here.

¶112First, we address the OLR's "amendment" of its
pre-appellate fees in its post-appellate statement of costs.The four justices who have found a violation
on Count 2 (Chief Justice Abrahamson, Justice Bradley, Justice Crooks, and
Justice Prosser) conclude that in the present case the OLR should be bound by
the hours and fees that it submitted in its original statement of costs.The rules do require that the OLR is to
submit its primary statement of costs within 20 days after the filing of the
referee's report.SCR 22.24(2).That initial statement of costs should set
forth all of the OLR's fees through the time of the referee's report.The "supplemental" statement of
costs that is contemplated in cases where an appeal is filed is designed to
allow the OLR to add fees and expenses that it incurred during the appellate
process.It is not intended to allow the
OLR to change its pre-appellate fee request, at least not without a
demonstration of some valid reason for doing so.

¶113In this situation the OLR has not provided an adequate reason for
why it failed to include all of its counsels' hours in the original statement
of costs.This was not a situation where
some inadvertently overlooked entry was immediately corrected.Indeed, the OLR was not even aware that its
listing of hours could not possibly be complete until this court brought the
issue to its attention at oral argument.Moreover, the OLR has provided no explanation as to how the additional
hours it is now requesting were discovered or recovered after oral argument.Without that sort of explanation, we have no
way of knowing whether that process, which was clearly outside of the normal
process, produced a reliable listing of hours expended and fees incurred.Thus, having eliminated the OLR's
"amended" pre-appellate fees, the largest amount of costs that could be
imposed on Attorney Hupy would be $48,366.88.

¶114Three members of this court (Chief Justice Abrahamson, Justice
Bradley, and Justice Crooks) conclude that Attorney Hupy should be liable for
this amount.They note that under the
current version of SCR 22.24(1m),[12]
the court's general policy is, upon a finding of misconduct, to impose all
costs upon the respondent attorney, unless the attorney is able to demonstrate
extraordinary circumstances.They
conclude that, with the exception of the "amended" pre-appellate
costs denied above, Attorney Hupy has not provided an adequate reason to
deviate from the court's general practice of imposing full costs.

¶115The fourth justice who has determined that Attorney Hupy engaged in
at least one count of misconduct (Justice Prosser) believes that the costs in
this proceeding should be reduced to some degree.Justice Prosser believes that a relatively
small reduction in the costs is appropriate in this case given that Attorney
Hupy has been found to have engaged in misconduct on only one out of the three
counts the OLR alleged.In addition,
Justice Prosser notes that this disciplinary proceeding did not stem from Attorney
Hupy's betrayal of his clients.Rather,
it stemmed initially from a dispute between competing attorneys.Moreover, given the nature of the misconduct
at issue, the end result of this proceeding will be a public reprimand on an
attorney who has never previously been disciplined.Justice Prosser concludes that it would
simply be unfair to impose nearly $50,000 in costs on Attorney Hupy under these
circumstances.

¶116Consequently, although there are four justices who would impose costs,
there is not full agreement among those four justices as to the amount of
costs.Three justices would impose costs
in excess of $35,000 and one justice would impose costs of $35,000.Because there must be at least four justices
out of the six participating justices to form a majority for any result, there
is a majority only to impose $35,000 in costs on Attorney Hupy.Four justices agree that costs of at least
$35,000 should be imposed.There are not
four justices who agree on any higher cost amount.Thus, the court determines that Attorney Hupy
must pay costs in this proceeding in the amount of $35,000.

¶117To summarize, the court is evenly split with respect to whether
Attorney Hupy's use of a postcard stating that lawyers can mail letters and
advertise on television without ever having tried a personal injury case
violated SCR 20:8.4(c).A majority
of the court concludes that Attorney Hupy's distribution of a brochure article
in early 2006 that indicated Attorney Hausmann was still practicing law pending
his criminal appeal constituted conduct involving a misrepresentation, in
violation of SCR 20:8.4(c).The court
further concludes that Attorney Hupy's use of a 35th anniversary
sticker on his firm's letterhead in 2004 was not a violation of former SCRs
20:7.1(a) or 20:7.5(a).Given the
violation of SCR 20:8.4(c) in connection with the brochure article, the
court determines that Attorney Hupy should be publicly reprimanded for his professional
misconduct.Finally, a majority of the
court concludes that Attorney Hupy should be required to pay costs in the
amount of $35,000.

¶118IT IS ORDERED that Michael F. Hupy is publicly reprimanded for his
professional misconduct.

¶119IT IS FURTHER ORDERED that within 60 days of the date of this order,
Michael F. Hupy pay to the Office of Lawyer Regulation costs in the amount of
$35,000.If the costs are not paid
within the time specified and absent a showing to this court of his inability
to pay the costs within that time, the license of Michael F. Hupy to practice
law in Wisconsin
shall be suspended until further order of the court.

¶120MICHAEL J. GABLEMAN, J., did not participate.

¶121PATIENCE DRAKE ROGGENSACK, J. and ANNETTE
KINGSLAND ZIEGLER, J. (dissenting). We conclude that
the Office of Lawyer Regulation has failed to meet its burden to prove any of
the counts alleged in the Complaint.Accordingly,
we would dismiss the Complaint against Attorney Hupy and we respectfully
dissent from the majority opinion.

[1]SCR 20:8.4(c) states it
is professional misconduct for a lawyer to "engage in conduct involving
dishonesty, fraud, deceit or misrepresentation;... ."

[2]Justice Roggensack and
Justice Ziegler conclude that the OLR did not prove a violation of SCR
20:8.4(c) on Count 2 and therefore dissent.

[3] Former SCR 20:7.1(a)
(effective through June 30, 2007) provided as follows:

A lawyer shall not
make a false or misleading communication about the lawyer or the lawyer's
services.A communication is false or
misleading if it:

(1) contains
a material misrepresentation of fact or law, or omits a fact necessary to make
the statement considered as a whole not materially misleading;

(2) is
likely to create an unjustified expectation about results the lawyer can
achieve, or states or implies that the lawyer can achieve results by means that
violate the Rules of Professional Conduct or other law;

(3) compares
the lawyer's services with other lawyers' services, unless the comparison can
be factually substantiated; or

(4) contains
any paid testimonial about, or paid endorsement of, the lawyer without
identifying the fact that payment has been made or, if the testimonial or
endorsement is not made by an actual client, without identifying that fact.

A lawyer shall not use
a firm name, letterhead or other professional designation that violates Rule 7.1.
A trade name may be used by a lawyer in
private practice if it does not imply a connection with a government agency or
with a public or charitable legal services organization and is not otherwise in
violation of Rule 7.1.

[5]The law firm is now
known as Hupy and Abraham S.C.For ease of reference, this decision will
refer to the law firm as the "Hupy law firm."

[6]This law firm is
currently known as McNally Law Offices, S.C.It will be referenced as "Hausmann-McNally" in this decision.

[7]The referee expressly
found that at the time the postcards were created and distributed all of the
lawyers at the Hausmann-McNally firm had tried personal injury cases.

Every written,
recorded or electronic communication from a lawyer soliciting professional
employment from a prospective client known to be in need of legal services in a
particular matter shall include the words "Advertising Material" on
the outside envelope, if any, and at the beginning and ending of any printed,
recorded or electronic communication, unless the recipient of the communication
is a person specified in pars. (a)(1) or (a)(2), and a copy of it shall be
filed with the office of lawyer regulation within five days of its
dissemination.

[9]As discussed below,
because Attorney Hupy made this same argument on appeal, this court ordered
additional memoranda on the scope of the review of advertising materials
conducted by the OLR.

[10] Paragraph 21 in the referee's
findings of fact, however, states that the statement in the postcard "is
dishonest, deceitful, and misleading."

[11]The attorney's oath
taken by all attorneys who are licensed to practice in this state, now located
in SCR 40.15, states in pertinent part, "I will abstain from all offensive
personality and advance no fact prejudicial to the honor or reputation of a
party or witness, unless required by the justice of the cause with which I am
charged;...."

The court's general
policy is that upon a finding of misconduct it is appropriate to impose all
costs, including the expenses of counsel for the office of lawyer regulation,
upon the respondent.In cases involving
extraordinary circumstances the court may, in the exercise of its discretion,
reduce the amount of costs imposed upon a respondent.In exercising its discretion regarding the
assessment of costs, the court will consider the submissions of the parties and
all of the following factors:

(a) The number of
counts charged, contested, and proven.

(b) The nature of
the misconduct.

(c) The level of
discipline sought by the parties and recommended by the referee.